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Aba 103: Introduction To Accounting 1 Question Paper
Aba 103: Introduction To Accounting 1
Course:Bachelor Of Business Administration
Institution: Jaramogi Oginga Odinga University Of Science And Technology question papers
Exam Year:2017
JARAMOGI OGINGA ODINGA UNIVERSTY OF SCIENCE AND TECHNOLOGY
SCHOOL OF BUSINESS AND ECONOMICS
UNIVERSITY EXAMINATION FOR THE DEGREE OF BACHELOR OF BUSINESS ADMINISTRATION WITH IT
1ST YEAR 1ST SEMESTER 2016/2017 ACADEMIC YEAR
NAIROBI CITY LEARNING CAMPUS
COURSE CODE: ABA 103
COURSE TITLE: INTRODUCTION TO ACCOUNTING 1
EXAM VENUE : STREAM : (BBA)
DATE : 18/04/17 EXAM SESSION :9.00 – 11.00 AM
TIME : 2.00 HOURS
Instructions :
Answer Question ONE (COMPULSORY) and ANY other 2 questions.
Candidates are advised not to write on the question paper.
Candidates must hand in theiranswerbooklets to the invigilatorwhile in the examination room.
QUESTION ONE
Define accounting (2 marks)
Distinguish between the following terms
(i)Fixed asset and current assets (2marks)
(ii)Long-term liabilities and current liabilities(2marks)
(iii) Capital expenditure and revenue expenditure(2 marks)
(c) Describe five books of original entry(10marks)
(d) A cashier in a firm starts with Sh 20,000 in the month June (that is the cash float)
In the following week, the payments made were as follows
Shs.
1st June –bought stamps for 800
2nd June- paid bus fare 1,200
2nd June –cleaning materials 2,400
3rd June- bought fuel 1,500
3rd June- cleaning wages 3,000
4th June-bought stamps 2,000
4th June-paid Johnson (creditor) 4,000
5th June-fuel costs 1,500
On 5th of June the cashier requested for a refund of the cash spent and this a mount was
reimbursed back
Required:
Prepare a detailed petty cash book showing the balance to be carried forward to the next
period and the relevant expense accounts, as they would a appear on the General Ledger
(12 marks)
QUESTION TWO
KK Ltd has the following assets and liabilities as on 1st January 2016
Creditors Sh39,500,Equipment Sh. 115,000, motor vans Sh.62,900,Stock,Sh.61500,DebtorsSh.57,700,cash at bakSh.72,800 and cash in hand Sh.400.
During the year the following transactions took place
Bought extra equipment on credit for Sh.13,800
Bought extra stock by cheque Sh.5,700
Paid creditors by cheque Sh.7,900
Received from debtors Sh.8,400 by cheque and sh,600 by cash
Put in an extra sh,2,500 cash as capital
Required
Draw up all the relevant accounts (12 marks)
Draw up the balance sheet as at 31st December 2016(8 marks)
QUESTION THREE
On 31st March 2016 the trial balance that follows was taken out from the books of ZED
ZED Ltd. Prepare the trading profit or loss account for the year and the balance sheet as
At that date after making the following adjustments
DR CR
Trial balance 92,230
Capital account 126,177
Sales
Creditors 22,680
Other creditors 1,000
Purchases return 3,172
Bills payable 6,422
Plant and machinery 55,000
Fixtures and fittings 1,720
Factory fuel and power 542
Office salaries 3,745
Lighting (factory) 392
Travelling expenses 925
Carriage on sales 960
Cash at bank 2,245
Cash in hand 68
Debtors 47,800
Purchases 83,290
Manufacturing 9,915
Rent and taxes 1,765
Office expenses 2,778
Carriage on purchases 897
Discount 422
Drawings 6,820
Stock 1st April 2015 21,725
Manufacturing expenses 2,680
Sales return 7,422
Insurance 570
251,681 251,681
Adjustments
(a) Depreciate plant and machinery 5% and fixtures and fittings 10%
(b) Provide for doubtful debts 25% of debtors
(c) Provision for rent for March Sh.150
(d) Unexpired insurance was Sh. 70
(e) Wages and salaries outstanding were shs.800 and shs.350 respectively
(f) Stock on 31ST March 2016 was Sh.16, 580
(i ) Profit and loss account (10 marks)
(ii) Balance sheet (10 marks)
QUESTION FOUR
Describe any four errors that do not affect the trial balance (8 marks)
(b) A bookkeeper extracted a trial balance on 31st December 2016 that failed to agree by
Sh.3, 300, a shortage on the credit side of the trial balance.Suspense account for the difference.
In January 2017 the following errors made in year 2016 were found:
Additional information
Sales day book had been under cast by Sh.1,000
Sales of Sh.2,500 to Jack had been debited in error to Jane’s account
Rent account had been under cast bySh.700
Discount received account had been under cast by Sh.3, 000.
The sales of motor vehicle at book value had been credited in error to sales account Sh.3,600’
Required
(a} Show the journal entries necessary to correct the errors (8 marks)
(b) Draw up the suspense account after the errors described have been corrected
(4 marks)
QUESTION FIVE
(a) Explain the meaning of following concepts/principles in financial accounting and give an example of each of the principles or concepts
(i) Going concern (4marks)
(ii) Accruals (4 marks)
(iii) Prudence (4 marks)
(v) Materiality (4 marks)
(v) Relevance (4 marks)
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